JOINT CIRCULAR - state.nj.us

1 JOINT CIRCULAR STATE OF NEW JERSEY DEPARTMENT OF THE TREASURY NO.: 18-03-OMB/DPP/OIT ORIGINATING AGENCY: PAGE 1 OF 5 OFFICE OF MANAGEMENT AND BUDGET (OMB) DIVISION OF PURCHASE AND PROPERTY (DPP) OFFICE OF INFORMATION TECHNOLOGY (OIT) EFFECTIVE EXPIRATION SUPERSEDES: 17-02-OMB/DPP/OIT DATE: 08-22-17 DATE: INDEFINITE SUBJECT: PROCUREMENTS OF INFORMATION TECHNOLOGY (IT) HARDWARE, SOFTWARE, SUBSCRIPTION-BASED SOLUTIONS AND RELATED SERVICES AND NON-IT EQUIPMENT ATTENTION: DIRECTORS OF ADMINISTRATION, CHIEF FISCAL OFFICERS, CHIEF INFORMATION OFFICERS, AGENCY IT MANAGERS, AND AGENCY PROCUREMENT MANAGERS FOR INFORMATION CONTACT: OMB IT PROCUREMENTS OMB NON-IT PROCUREMENTS PROCUREMENT BUREAU, DPP (609) 292-4886 CONTRACT COMPLIANCE & AUDIT UNIT, DPP (609) 292-5400 OIT EXTERNAL IT PROCUREMENT REVIEW UNIT (609) 777-3773 This CIRCULAR supersedes 17-02-OMB/DPP/OIT governing IT procurements and non-IT equipment procurements.

2 This CIRCULAR outlines that the purchase of all IT infrastructure assets, regardless of dollar value, which require prior OIT approval pursuant to Executive Order No. 225. In addition, this revised CIRCULAR now outlines procedures for review and approval of non-IT equipment purchases using contracts within the NJSTART system. I. PURPOSE A. To list the justifications that are required to be met for procurement and purchases under an existing contract for IT hardware, software, and related services ( maintenance, subscription renewals, associated training, programming and consulting services) and non-IT equipment. See, IT vs. Non-IT Equipment Guidelines (Attachment B).

3 B. To establish procedures for continuation payments for maintenance, subscription renewals, rental and lease/purchase of installed IT hardware, software, subscription-based solutions, and related services. C. To define the dollar thresholds for required review by the Office of Information Technology (OIT) or the Office of Management and Budget (OMB). ORIGINATING AGENCY: OFFICE OF MANAGEMENT AND BUDGET (OMB) DIVISION OF PURCHASE AND PROPERTY (DPP) OFFICE OF INFORMATION TECHNOLOGY (OIT) NO.: 18-03-OMB/DPP/OIT PAGE 2 of 5 II. POLICY A. GENERAL 1. This CIRCULAR applies to all purchases, including DPA purchases, services and supplies procured through Procurement Bureau term contracts, GSA based contracts, Cooperative contracts, and contracts procured through a waiver of advertising.

4 2. Like purchases should be aggregated. Agencies must not divide purchases to fall below any thresholds in order to circumvent the review. 3. If the procurement or purchase is to be made solely with federal funds, a federal certification form (Attachment C) must be included as part of the package. This certification will permit expedited review from OMB. 4. Regardless of dollar value, all procurements or purchases that primarily use State or dedicated funds will be considered if they meet one of the following justifications: a) Denial of the purchase would cause loss of investment or significantly increase future costs. b) The purchase is related to a program that is mandated by the federal government, State law, or a court order.

5 C) Equipment is demonstrated as failing and, without approval, mission critical business functions would be impacted or halted. d) Equipment is needed for ongoing maintenance. e) Requests not covered by items a) through d) will be addressed on a case by case basis. 5. Dollar thresholds for OIT/OMB review: a) IT purchases whose total dollar value exceeds $50,000 are subject to OIT review and approval, in order to assure compliance with statewide policies and standards. Purchases whose total dollar value exceeds $100,000 are also subject to simultaneous OMB review and approval. Any requested purchase that is more than $50,000 and less than $100,000 is subject to OMB review on an as-needed basis as determined by the Director, OMB.

6 Procurements of less than $50,000 do not require advance approval, but should conform to allowable procurement justifications summarized in Section b) Non-IT purchases greater than $40,000 require prior approval from OMB. For equipment valued at less than $40,000, agencies may invoke one of the allowable purchase justifications noted in Section of this CIRCULAR , however, that action is subject to a post-audit review by OMB. If an agency is found to be in violation of the letter or spirit of this CIRCULAR (exhibiting, for instance, a series of questionable purchases of discretionary items), they will be held to a threshold limit set at the OMB Director s discretion for future purchases.

7 In addition, the Office of the State Comptroller may conduct periodic audits to ensure that agencies are operating within the guidelines and boundaries set by this CIRCULAR . 6. Purchases requiring OMB review, made with either State or non-State funds, excluding those purchased solely with federal funds, will be subject to a thorough review of all aspects of the request including, but not limited to, confirmation of account number(s) and available balances, analysis of current/projected fiscal position, documentation of need, and other analyses as needed or required. For federal funds purchases, a summary review will be completed by OMB to ensure the account number is correct and the funding is in place.

8 7. With the exception of DPA, and excluding purchases made by departments exercising statutory independent procurement authority, DPP will not process any IT-related procurements or purchases as defined herein without the approval of OIT and, if applicable, OMB. ORIGINATING AGENCY: OFFICE OF MANAGEMENT AND BUDGET (OMB) DIVISION OF PURCHASE AND PROPERTY (DPP) OFFICE OF INFORMATION TECHNOLOGY (OIT) NO.: 18-03-OMB/DPP/OIT PAGE 3 of 5 8. GSA procurements for IT are also subject to CIRCULAR 13-15-DPP, Purchases from Federal Supply Schedules or Schedules of Other Federal Procurement Programs. Procurements of vehicles are also subject to CIRCULAR 17-06-ADM, Procurement of State Motor Vehicles.

9 Line of Credit purchases are subject to CIRCULAR 17-12-OPF/OMB, Master Lease/Line of Credit Program. Furniture and carpeting purchases are governed by CIRCULAR 11-13-DPMC, Procedures for the Acquisition of Furniture and Carpeting. Equipment purchased for road maintenance and construction is not subject to this CIRCULAR . B. IT INFRASTRUCTURE PURCHASES 1. Agencies are not permitted to purchase any information technology infrastructure , regardless of dollar value, unless granted approval due to exceptional circumstances by OIT. Information technology infrastructure is defined as computing, storage, network, and data center assets ( , servers, routers, racks).

10 All IT procurements must conform to OIT s standards and policies, and to the approved departmental IT Tactical Plans, as outlined in the OIT IT Procurement Technical Approval Request, except as otherwise approved by the agency s Chief Executive. 2. OIT will fast track its approval process for procurements or purchases over $50,000 for maintenance renewal of existing licenses of shrink-wrapped software ( , Adobe Professional, Visio, IBM FileNet) which do not include additional licenses, scope changes, or services, and have a written agreement signed by DPP in place. NOTE: Due to limitations of the e-Catalog system, OIT cannot distinguish commodity type in purchases in order to exclude items listed in Section 2 (above) from full OIT review.